Planning for retirement can seem scary. People are living longer now, so there is an increased need for more retirement savings. Consumers are encouraged to start planning as early as they can, but it is never too late. There are plenty of options to help assist consumers in securing a financially safe future. To help, national nonprofit American Consumer Credit Counseling (ACCC) explains different plan options consumers can consider when planning for retirement.
“Retirement can be a daunting subject, but with the right preparation, the financial costs can be manageable,” said Steve Trumble, President and CEO of American Consumer Credit Counseling. “Consumers should start planning as early as possible and take advantage of all the resources and options available. Do your research so that you can be prepared for what plans are available to you, thus maximizing your retirement funds.”
According to CNBC, most Americans close to retirement have only saved 12 percent of what they need. Those between the ages of 55 and 64 have an average of $120,000 saved, while experts recommend that consumers should have $1 million saved. Additionally, experts are saying that $1 million does not stretch as far as it did in the past.
ACCC explains retirement plan options.
1. Individual Retirement Accounts (IRA) – An IRA is a tax-advantaged tool that consumers can use to save for retirement. Once money is put into this type of retirement savings account, consumers can invest funds in areas such as bonds, mutual funds, and stocks. Consumers may consider these accounts if their employer doesn’t have retirement options.
2. Roth IRA – A Roth IRA retirement savings plan allows consumers to contribute after-tax income up to a certain amount per year. The money earned in this savings account will not be taxed upon distribution.
3. 401(k) – 401(k) retirement accounts are offered by employers as an employee benefit. With this retirement savings plan, consumers can contribute a portion of their pre-tax income and reduce the amount of income tax they pay that year. Many employers will also offer a match of up to 50 percent on these accounts as an employee benefit.
4. Spousal IRA – A Spousal IRA allows a consumer’s nonworking spouse to accumulate tax-advantaged savings for retirement.
5. Rollover IRA – Consumers can use a Rollover IRA to move retirement saving funds from an old employer-sponsored plan to an IRA.
ACCC is a 501(c)3 organization that provides free credit counseling, bankruptcy counseling, and housing counseling to consumers nationwide in need of financial literacy education and money management. For more information, contact ACCC:
- For credit counseling and student loan counseling, call 800-769-3571
- For bankruptcy counseling, call 866-826-6924
- For housing counseling, call 866-826-7180
- Or visit us online at http://www.ConsumerCredit.com
About American Consumer Credit Counseling
American Consumer Credit Counseling (ACCC) is a nonprofit credit counseling 501(c)(3) organization dedicated to empowering consumers to achieve financial management through credit counseling, debt management, bankruptcy counseling, housing counseling, student loan counseling and financial education concerning debt solutions. To help consumers reach their goal of debt relief, ACCC provides a range of free consumer personal finance resources on a variety of topics including budgeting, credit and debt management, student loan assistance, youth and money, homeownership, identity theft, senior living, and retirement. Consumers can use ACCC’s worksheets, videos, calculators, and blog articles to make the best possible decisions regarding their financial future. ACCC holds an A+ rating with the Better Business Bureau and is a member of the National Foundation for Credit Counseling® (NFCC®). For more information or to access free financial education resources, log on to ConsumerCredit.com or visit http://www.consumercredit.com/financial-education.aspx
